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Banks issue forex to importers of banned items

An examination of returns on the utilisation of funds by banks has shown that some items prohibited by the Central Bank of Nigeria (CBN) to…

An examination of returns on the utilisation of funds by banks has shown that some items prohibited by the Central Bank of Nigeria (CBN) to access foreign exchange from all official windows found their way into the list of the forex beneficiaries published by banks recently.
In June 2015, the CBN issued a circular that banned 41 items from accessing the forex in order to check the excessive deletion of external reserves and promote local manufacturing.
But some of the items in the banned list, such as tomato paste, rice and palm oil, etc, were included by some banks in their lists.
An advertorial published by the Access Bank Plc showed that a company, Vital Products Plc, got forex for importation of tomato paste concentrate at $64,018, despite the inclusion of the product on the list of items banned.
Diamond Bank, also in its advertorial, indicated that it issued $300,000 to Olam Nigeria Limited Palm Oil for the importation of crude palm oil despite being banned. 
Similarly, the Standard Chartered Bank also issued $300,000 to Elephant Group Limited for crude palm oil import.
GT Bank, in another publication, has issued $540,817.21 to Popular Farms and Mills Ltd for the importation of Thai Parboiled Rice.
The Bankers’ Committee, a forum for chief executives of commercial banks and the regulatory authorities, said on Thursday at the end of their first meeting this year, that the publication of the forex allocation was an initiative to ensure transparency for the process.
The CBN, in the circular, said  the implementation of the policy would help in a long way to conserve our hard earned foreign exchange and boost production activities in the country.
Other banned items include vegetable oil, metal boxes, galvanised steel cement, margarine, palm kernel, poultry products (chicken, eggs and turkey), Indian incense, tinned fish in sauce (Geisha, Sardines), cold rolled steel sheets, roofing sheets, wheelbarrows, head pans and containers, and enamelware.
Others are cosmetics, soap, plastic and rubber, steel drum, steel pipes, wire mesh, steel nails, wire rods, security wire, wood particle and board, wood fibre boards and panel, plywood board and panel, wooden doors, toothpicks, glass and glassware, kitchen utensils, tableware, tiles and wooden fabrics.
The CBN governor, Mr Godwin Emefiele explained that although the apex bank does not have the power to ban importation, the bank would ban foreign exchange provision to any importer who might want to import any of the 41 listed items.
“For the avoidance of doubt, please note that the importation of these items are not banned, thus importers desirous of importing these items shall do so using their funds without any recourse to the Nigerian foreign exchange market,” the apex bank boss said.

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